What is the Cost of EDI Implementation?

Overview

Evaluating the EDI cost (electronic data interchange) for implementation will be determined by the type of solution you choose for EDI. Your organization can either decide to take an in-house approach or work with a third-party EDI provider for an outsourced solution.

Calculating the cost of EDI implementation is vital in determining the real financial and business benefits for your organization.

Evaluating an In-House EDI Solution

Depending on the size of your organization, an initial option is to create your very own EDI network. An in-house solution offers the advantage of complete internal management, security and control, which must be evaluated closely to ensure you’re maximizing EDI cost savings and implementation expenses.

You must invest in the following key areas to begin an in-house solution. This is the foundational starting point for your EDI investment.
  • EDI software for mapping and translation; this should be purchased from an EDI software provider.
  • Types of communication methods.
  • EDI roles, such as an EDI analyst or EDI specialist. Understand that this may be noticeable if your organization is required to add a role.
  • IT infrastructure hosted internally or externally. Ask yourself where will your data be stored and accessed from?
  • An IT person or service to manage ongoing upgrades, support and technical maintenance.
  • Integration to back-office systems or ERP. This includes time and investment for seamless integration and rules and alerts for your most valuable documents.

If you budget and address the key areas above, your organization will be able to implement an internal EDI system.

Once your system is standing, and you have evaluated the cost of each section, you can begin implementation with your trading partners and their EDI system. Keep in mind that some trading partners may require your support for EDI compliance. This information will be provided to your organization from your trading partners, and each implementation guide will be unique to their needs.

Each trading partner will also have unique EDI compliance standards that you’ll need to abide by, and you will be expected to meet ongoing requirements as your trading partner community expands and changes.

The majority of organizations choose to utilize a third-party provider that can provide the above infrastructure without the high initial cost of EDI implementation. This significantly helps small and medium-sized businesses that do not have the IT investment, budget, or roles to launch their own EDI infrastructure within their company.

EDI Third-Party Providers

Utilizing an EDI provider will save you a great deal of time, internal resources and implementation costs. EDI providers have the infrastructure already in place to manage your data source, map to your ERP, offer reporting, and provide education about the software platform with your unique needs and usage in mind.

EDI providers typically offer a wide range of pricing models with the majority being a subscription solution. The available subscription models are as follows:

Pay As You Go
Monthly
Annual Subscription
When determining your final choice, you should consider the cost of EDI, as well as some key additional business factors.
  • Take into account the total number of trading partners who are compliant and network-ready.
  • Does the provider cover the range of locations you operate within? ANSI X12 standards are used within North America while EDIFACT is used globally. Most providers can support both methods of communication on a large scale.
  • What level of training and support will be provided to your organization and your trading partners? For the highest quality of support and training, seek organizations that offer EDI courses and in-house support.
  • Consider the variety of options the provider can offer you and your trading partners to exchange different versions of documents or communication methods.
  • Will your data set be hosted by the EDI provider or hosted internally within your organization?
  • Will the EDI provider give you access to the rules and reporting you want to be integrated with your back-end systems?
  • Does the provider have cost-per-transaction fees or any underlying fees that need to be understood?

The majority of providers charge based on the volume of data you transmit through your EDI network. This is usually measured in the number of kilo-characters (KCs) contained within the EDI document. Most of the time, the subscription models fall within a bracket of expected volume of KCs or documents. Remember to always be aware of hidden charges such as minimum record lengths, chargebacks, late fees and more.

Your EDI provider will go into detail with you about how to be the most efficient when exchanging business documents, as well as how to create rules and reporting to prevent chargebacks or late fees that may be incurred by your trading partners.

Always remember the volume and goal of your business transactions before selecting a provider. That way, you can select the pricing model that fits your organization’s needs best. To gain a better understanding of the 1 EDI Source solutions available, take a look at the following packages.



Let 1 EDI Source Help With Your EDI Implementation Process

As a leading EDI provider, 1 EDI Source offers a full line of high-quality, yet affordable EDI software solutions. Learn more about What Is EDI? and download our EDI 101 Guide today to jump-start your electronic data interchange education. Have a question or need more information about the cost of EDI? Reach out to our EDI experts. We’re here to support you every step of the way.

Download our EDI 101 Guide today to jump-start your EDI education. Have a question or need more information? Reach out to our EDI experts today. Our EDI professionals are here to support you every step of the way.

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